The Crypto "Community"

I have been interested in cryptocurrency since 2018, this was after the euphoric bull run of 2017. In my opinion, a perfect time to become interested in such a space as the space lost the hype. Having personally interacted with blockchains, crypto, and NFTs over the past few years, most of the commentary I see regarding the space is fairly bullish as my algos know me well. I have attended NFT meet-ups, Consensus, and most recently an XRP party. The XRP party was truly the crypto crowd that everyone memes.

This is no commentary on XRP itself, I am completely indifferent to the token, company, or anything to do with it, let me make that abundantly clear. I had RSVPed to the party roughly 2-weeks in advance via a Tweet from Ripple. The event was fully booked within 10 minutes of them releasing the tweet allowing people to RSVP. I had assumed that this event would fill up given the amount of followers Ripple gets but given their engagement, I had no clue it would fill up within a matter of minutes. Roughly 24 hours later they were already emailing me to let me know that if I was unable to make it, they highly encouraged me to cancel my RSVP ASAP as others were banking on more spaces opening up.

So, on the last Friday of September, I made the trek to New York City from the North Fork of Long Island. I saw the entrance to the Hammerstein Ballroom and went to check in. I was promptly informed that the 10-person line I was in was strictly for VIPs and to head to the back of the general admissions line. The line was so incredibly long, it went around 3 corners of the block almost reaching the entrance to the event again. I was utterly shocked and frankly ticked that I now had to wait in this obscene line. 

Fast forward an hour and 15 minutes, I arrived at the security check-in and went through the metal detectors. The event had free food and free booze, although the alcohol served reminded me of what college students put in a Gatorade container and mix with Crystal Light packages. Nonetheless, it was free, so I am sure that was a big driver behind people attending the event. 

Walking into the event, you see almost exactly what you’d expect from a crypto crowd. Some people are in sweatpants and a T-shirt, others in a full suit with an expensive watch. All congregating in the name of their favorite cryptocurrency, all giving off a distinct vibe that they think they are smarter than your average Joe for having invested in ‘the future’ of money. They are part of an ‘exclusive community’, they are the ‘early adopters’.

Everything was fairly status quo for one of these meet-ups until Brad Garlinghouse, the CEO of Ripple took the stage. The crowd went absolutely nuts like I am talking grade school children seeing their favorite pop-star nuts. He then began to give his speech. I think I counted the use of the word “community” 7 times as he addressed the crowd. As he shouted out his executive team, the crowd went wild each time he named and pointed out someone in the VIP section. It was right around here that I was like, “Okay, I have to get out of here, this is asinine.” He then brought up the SEC and how Ripple won the case. The mere word SEC was drowned out by the crowd’s booing. The only comparison I have to this speech would be a Jordan Belfort, Wolf of Wall Street-esque, hype-up speech. Brad then brought his speech to an abrupt halt, yelling, “And welcome Lenny Kravitz!” as Lenny Kravtiz literally took the stage and began performing for everyone. 

This sense of community that is built within these different tokens seems incredibly strong. It takes a lot for a ‘community’ to stand behind a company, token, or person the way I witnessed it that evening. XRP is down roughly 77% from its January 2018 high, even in crypto this is astonishing. It has never recovered its all-time high, even as bitcoin rose to $69,000, well above its January 2018 high. Even still, the community is infatuated with this token and company. 

As I mentioned before, I am interested in crypto. The rise and allure of the potential use cases for cryptocurrency are extremely interesting to me. However, over the past 2-3 years, we witnessed an absolute fallout in the crypto markets due to bad actors tarnishing the space. Haters rejoiced in the disappearance of nearly $2 trillion in the total market cap.

I took it upon myself to read Ben McKenzie’s new book, “Easy Money” right when it came out. This book does not call any one person, company, or token a fraud, but essentially claims the entire space is built off of Ponzi-nomics. This type of literature is a completely different take from what I usually consume in the crypto space, but I understand the point he’s trying to make. Ben argues that the communities behind the crypto tokens are somewhat of a self-fulfilling prophecy, where believers are essentially forming their own ecosystem of trading to and from each other, bidding up the prices of the tokens. I saw clear parallels between what his arguments were and what took place at the event. 

I think the takeaway from the whole experience for me was to be wary of how “communities” of people act and think in the investment space. I think it is these very communities that led to the retail investor holding the bags of the 2022 crypto fallout. These groups build their community from the idea that sticking together strengthens them. Essentially it gives off a vibe of, “Hey man, I’m down 60% too. Let’s stick together and we can be down 60% together.” This sense of community you feel so ingrained in can serve as massive confirmation bias for the investments you are making. Ensuring that you are consuming information from both sides of the aisle when it comes to investing is incredibly useful. Ben’s book is not something I would ordinarily read; however, it brought a new perspective to the space for me. As always, DYOR, and be wary of the reasoning behind where you choose to allocate your hard-earned dollars.  

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